Auction-Price Dynamics for Fine Wines from Age-Period-Cohort Models

2017 ◽  
Vol 12 (2) ◽  
pp. 173-202 ◽  
Author(s):  
Joseph L. Breeden ◽  
Sisi Liang
Keyword(s):  
Price Dynamics ◽  
Chinese Stock Market ◽  
Specification Errors ◽  
Auction Houses ◽  
Auction Price ◽  
Hedonic Modeling ◽  
Price Appreciation ◽  
Key Drivers ◽  
Jel Classifications

AbstractIn an attempt to expand the understanding of auction-price dynamics for fine wines, an age-period-cohort (APC) algorithm is applied to a database of 1.5 million auction results to quantify key drivers of these price dynamics. APC algorithms are designed to separate price appreciation with the age of the wine from overall wine-market conditions as well as to adjust for the unique value of specific vintages. In this context, the APC modeling provides a kind of Hedonic modeling, with specific controls regarding specification errors.The analysis was segmented by Château Lafite Rothschild, Bordeaux excluding Lafite, and Burgundy so that we could test specific events related to Château Lafite Rothschild. The results show price dynamics versus the ages of the wines and allow for the measurement of long-term price-appreciation potential. Environment functions versus auction dates quantify the “Lafite Bubble” and suggest past correlation to Chinese stock-market indices. An analysis of wine ratings versus price quantifies their nonlinear relationship. An analysis across nine auction houses shows a significant price spread for similar wines. (JEL Classifications: C23, D44, G11, G12, Q11)

Tax-Advantaged Trust Use Among IPO Executives: Determinants and Implications for Valuation and Future Performance

2019 ◽  
Vol 95 (3) ◽  
pp. 145-175 ◽  
Author(s):  
Michael J. Dambra ◽  
Matthew Gustafson ◽  
Phillip J. Quinn
Keyword(s):  
Stock Price ◽  
Relevant Information ◽  
Data Availability ◽  
Market Prices ◽  
The Public ◽  
Future Performance ◽  
Estate Taxes ◽  
Price Appreciation ◽  
One Year ◽  
Jel Classifications

ABSTRACT We examine the prevalence and determinants of CEOs' use of tax-advantaged trusts prior to their firm's IPO. Twenty-three percent of CEOs use tax-advantaged pre-IPO trusts, and share transfers into tax-advantaged trusts are positively associated with CEO equity wealth, estate taxes, and dynastic preferences. We project that pre-IPO trust use increases CEOs' dynastic wealth by approximately $830,000, on average. We next examine a simple model's prediction that trust use will be positively related to IPO-period stock price appreciation. We find that trust use is associated with 12 percent higher one-year post-IPO returns, but is not significantly related to the IPO's valuation, filing price revision, or underpricing. This evidence is consistent with CEOs' personal finance decisions prior to the IPO containing value-relevant information that is not immediately incorporated into market prices. JEL Classifications: D14; G12; G32; M21; M41. Data Availability: Data are available from the public sources cited in the text.

scholarly journals Boomerang hiring: Strategy for sustainable development in COVID-19 era

2021 ◽  
pp. 1-6
Author(s):  
Penumadu V. Raveendra ◽  
Yellappa M. Satish
Keyword(s):  
Sustainable Development ◽  
Organization Culture ◽  
Human Beings ◽  
Hiring Process ◽  
Positive Growth ◽  
The World ◽  
Key Drivers ◽  
Hr Managers ◽  
The Right

BACKGROUND: Many companies are forced to restructure themselves by right sizing due to unexpected fall in demand for their products and services created by the COVID-19 pandemic. COVID 19 not only affected the health of human beings but also their wealth across the world. Global economic parameters are showing a sign of positive growth with decreased number of COVID 19 cases across the world. Many companies are in a dilemma to rehire their former employees or to hire the new candidates to meet the increased demand. OBJECTIVES: The objectives of study are i) to analyze the key drivers for boomerang hiring and ii) to develop a conceptual process for boomerang hiring. METHODS: An exploratory methodology was designed to identify the key drivers of boomerang hiring by studying the various successful stories of those companies which had rehired their former employees. Various papers were reviewed to develop the process for boomerang hiring. RESULTS: Study showed that knowledge about the culture of the company, cost of hiring, morale booster for the existing employees, and customer retention, are the key drivers for boomerang hiring. This hiring process requires special skills from HR Managers, as this decision will impact long term success of the company. CONCLUSION: The process of boomerang hiring cannot be standardized as each organization culture is different and companies cannot have the same strategy for each candidate as every individual is different. Boomerang hiring will work as the right strategy during pandemic situation as former employees would have built relations with the customers. The customers will be happy to see the former employees who had served them better.

Long run apartment price dynamics in Swedish and German cities

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Sviatlana Engerstam
Keyword(s):  
Banking Sector ◽  
Cointegration Analysis ◽  
Price Dynamics ◽  
Long Term Effects ◽  
Content Type ◽  
Macroeconomic Variables ◽  
Price Elasticities ◽  
Long Run ◽  
German Cities

PurposeThis study examines the long term effects of macroeconomic fundamentals on apartment price dynamics in major metropolitan areas in Sweden and Germany.Design/methodology/approachThe main approach is panel cointegration analysis that allows to overcome certain data restrictions such as spatial heterogeneity, cross-sectional dependence, and non-stationary, but cointegrated data. The Swedish dataset includes three cities over a period of 23 years, while the German dataset includes seven cities for 29 years. Analysis of apartment price dynamics include population, disposable income, mortgage interest rate, and apartment stock as underlying macroeconomic variables in the model.FindingsThe empirical results indicate that apartment prices react more strongly on changes in fundamental factors in major Swedish cities than in German ones despite quite similar development of these macroeconomic variables in the long run in both countries. On one hand, overreactions in apartment price dynamics might be considered as the evidence of the price bubble building in Sweden. On the other hand, these two countries differ in institutional arrangements of the housing markets, and these differences might contribute to the size of apartment price elasticities from changes in fundamentals. These arrangements include various banking sector policies, such as mortgage financing and valuation approaches, as well as different government regulations of the housing market as, for example, rent control.Originality/valueIn distinction to the previous studies carried out on Swedish and German data for single-family houses, this study focuses on the apartment segment of the market and examines apartment price elasticities from a long term perspective. In addition, the results from this study highlight the differences between the two countries at the city level in an integrated long run equilibrium framework.

Long-Term Prospects of the International Wine Trade

2018 ◽  
Vol 13 (4) ◽  
pp. 442-450 ◽  
Author(s):  
Olivier Bargain ◽  
Jean-Marie Cardebat ◽  
Raphael Chiappini ◽  
Corentin Laffitte
Keyword(s):  
New Zealand ◽  
Great Emphasis ◽  
Market Structures ◽  
On Demand ◽  
The United Kingdom ◽  
Comparative Advantages ◽  
The Future ◽  
Jel Classifications ◽  
Wine Trade

AbstractThis article discusses key comparative advantages of wine-producing nations and suggest prospective views on their evolution. Our methodology is twofold. First, we study comparative advantages in 16 countries using Porter's diamond. Then, we report results from a survey in which wine economists are asked to assess the future trade performance of these countries. Results are relatively consistent across methods regarding the future “heavy weights” like China, but also New Zealand and Chile, countries show the greatest potential to succeed in the future global wine trade. It is also expected that Georgia, the United Kingdom, and Australia play an important role, although to a lesser extent. Our findings indicate that comparative advantages in wine trade are neither uniform nor static; especially, terroir is no longer sufficient. The diamond approach contradicts experts from two countries in particular, France and Argentina, suggesting that experts put great emphasis on demand and market structures as key trade determinants for the future. (JEL Classifications: F14, Q17)

scholarly journals Spatially varying constraints of human-caused fire occurrence in British Columbia, Canada

2017 ◽  
Vol 26 (3) ◽  
pp. 219 ◽  
Author(s):  
Philip E. Camp ◽  
Meg A. Krawchuk
Keyword(s):  
British Columbia ◽  
Spatial Patterns ◽  
Fire Management ◽  
Fire Occurrence ◽  
Explanatory Variables ◽  
Human Footprint ◽  
Key Factor ◽  
Key Drivers ◽  
Spatially Varying

Human-caused wildfires are controlled by human and natural influences, and determining their key drivers is critical for understanding spatial patterns of wildfire and implementing effective fire management. We examined an array of explanatory variables that account for spatial controls of human-caused fire occurrence from 1990 to 2013 among six ecosystem zones that vary in human footprint and environmental characteristics in British Columbia, Canada. We found that long-term patterns of human-caused fire in ecosystem zones with a larger human footprint were strongly controlled by biophysical variables explaining conditions conducive to burning, whereas fire occurrence in remote ecosystem zones was controlled by various metrics of human activity. A metric representing the wildland–urban interface was a key factor explaining human-caused fire occurrence regardless of ecosystem zone. Our results contribute to the growing body of research on the varying constraints of spatial patterns of fire occurrence by explicitly examining human-caused fire and the heterogeneity of constraints based on human development.

COMMON FEATURES IN EAST ASIAN STOCK MARKETS: LONG-TERM AND SHORT-TERM COMOVEMENTS BETWEEN CHINA AND KOREA

2013 ◽  
Vol 58 (03) ◽  
pp. 1350018
Author(s):  
HAHN SHIK LEE ◽  
SOO IN KIM
Keyword(s):  
Stock Markets ◽  
East Asian ◽  
International Investment ◽  
Cointegration Analysis ◽  
Chinese Stock Market ◽  
Short Term ◽  
Financial Firms ◽  
Contemporaneous Correlation ◽  
East Asian Stock Markets

As increasing attention has been given in recent literature to the potential of the Chinese financial market, we investigate the strength of shared dynamics among East Asian stock markets, by examining both the long-term and short-term comovements. In doing so, the cointegration analysis is used to assess the long-term relationship, whereas the notions of cofeature as well as contemporaneous correlation are employed to discuss the short-term relationship. The basic finding is that evidence for short-term comovement between the Korean and Chinese stock markets appears to be strong, while evidence for long-term relationship is rather weak. Empirical results from subsamples suggest that both the long-term and short-term relationships have strengthened since the acquisition of QFII qualification by Korean financial firms. These observations indicate that the international linkage between the two countries has strengthened along with increasing opportunities for international investment in the Chinese stock market.

scholarly journals Policy brief for Privately Protected Areas Futures 2017: Supporting the long-term stewardship of privately protected areas

2017 ◽  
Author(s):  
Matthew Selinske ◽  
Mathew Hardy ◽  
Ascelin Gordon ◽  
Andrew Knight
Keyword(s):  
Protected Areas ◽  
Economic Benefits ◽  
Diverse Range ◽  
Financial Costs ◽  
Or Groups ◽  
Conservation Values ◽  
Key Drivers ◽  
Successive Generations ◽  
Privately Owned

Globally, privately protected areas (PPAs) are an increasingly popular approach to long-term protection of biodiversity on privately owned lands. PPAs provide multiple ecological, social and economic benefits to diverse range of stakeholders in across a range of contexts. These include supporting the desire of landowners to protect conservation values on their land, contributing to national conservation targets, and reducing financial costs of land management togovernments. In addition, they provide opportunities to engage landowners to strengthen community social and conservation values through positive partnerships with governments, NGOs, and other groups. This policy brief explores the key drivers of landowner participation in PPA programs (i.e.covenants, easements, servitudes and other long-term agreements with individuals or groups of landowners) and the program mechanisms that maintain successive generations of landowners to be engaged and committed to long-term stewardship. It also considers the challenges faced by PPA programs in developing and maintaining strong collaborative arrangements between the stakeholders involved in these programs.

Clawbacks and Earnings Management

2018 ◽  
Vol 31 (3) ◽  
pp. 129-151 ◽  
Author(s):  
Carolyn B. Levine ◽  
Michael J. Smith
Keyword(s):  
Numerical Analysis ◽  
Earnings Management ◽  
Cash Flows ◽  
Data Availability ◽  
Real Earnings Management ◽  
Interim Report ◽  
Short Term ◽  
Period Model ◽  
Jel Classifications

ABSTRACT This study addresses the effect of clawbacks on earnings management (EM). In a two-period model, the manager can report truthfully or distort an interim report using either accrual or real EM. The principal can make short-term payments based on a manipulable accounting signal and long-term payments based on unmanipulable cash flows. The strength of the clawbacks determines the likelihood that the manager's compensation is reclaimed when the interim report was managed. Stronger clawback provisions may result in (1) a substitution between accrual and real earnings management, or (2) earnings management when no earnings management was optimal with weak clawbacks, and (3) lower expected profits for the principal. Numerical analysis suggests that strong clawbacks do not reduce aggregate earnings management. JEL Classifications: J33; M48; M52; G38. Data Availability: All data are simulated.

Long-Term Orientation and Earnings Management Strategies

2019 ◽  
Vol 18 (3) ◽  
pp. 97-119 ◽  
Author(s):  
Jesper Haga ◽  
Fredrik Huhtamäki ◽  
Dennis Sundvik
Keyword(s):  
Earnings Management ◽  
High Precision ◽  
Management Strategy ◽  
Management Strategies ◽  
Real Earnings Management ◽  
Short Term ◽  
Country Level ◽  
Earnings Benchmarks ◽  
Jel Classifications

ABSTRACT In this study, we investigate how country-level long-term orientation affects managers' willingness to engage in earnings management and choice of earnings management strategy. Using a comprehensive dataset of 47 countries for the period from 2003 to 2015, we find that firms in long-term-oriented cultures rely relatively more on earnings management through accruals, while firms in short-term-oriented cultures engage in relatively more real earnings management. Furthermore, we find a larger discontinuity around earnings benchmarks in long-term-oriented cultures suggesting that manipulation of accruals enables benchmark beating with high precision. JEL Classifications: M14; M16; M21; M41.

Long-Term Impact of Economic Conditions on Auditors' Judgment

2018 ◽  
Vol 93 (6) ◽  
pp. 203-229 ◽  
Author(s):  
Xianjie He ◽  
S. P. Kothari ◽  
Tusheng Xiao ◽  
Luo Zuo
Keyword(s):  
Financial Reporting ◽  
Formative Period ◽  
Early Career ◽  
Economic Conditions ◽  
Career Stage ◽  
Audit Opinion ◽  
Economic Downturns ◽  
Long Term Impact ◽  
Jel Classifications

ABSTRACT We find that economic conditions at the time an auditor enters the labor market have a long-term impact on her judgment and decision making. Specifically, engagement partners who started their career during economic downturns issue audit adjustments more frequently. For the subsample of company-years with no audit adjustments, downturn auditors are more likely to issue a modified audit opinion. In addition, companies audited by downturn auditors are less likely to violate financial reporting and disclosure regulations. Together, our findings suggest that the early career stage is a critical formative period for auditors. JEL Classifications: J24; M42.

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